CASE # FEB LEASING & FINANCE CORPORATION (now BPI LEASING CORPORATION) v. SPOUSES SERGIO P.

BAYLON & MARITESS VILLENA-BAYLON, BG HAULER, INC., and MANUEL Y. ESTILLOSO G.R. No. 181398 JUNE 29, 2011

FACTS: On 2 September 2000, an oil tanker registered in the name of BPI Leasing hit a pedestrian - Loretta V. Baylon (Loretta), daughter of respondent spouses Sergio P. Baylon and Maritess Villena-Baylon (spouses Baylon). The oil tanker was leased to BG Hauler, Inc. (BG Hauler) and was being driven by the latters driver, Manuel Y. Estilloso. The oil tanker was insured by FGU Insurance Corp. (FGU Insurance). The RTC held all 3 jointly liable. CA affirmed but deleted attorneys fees for being speculative. BPI Leasing contended that it is not liable because it was not actually operating the oil tanker.

ISSUES: Whether the registered owner of a financially leased vehicle remains liable for loss, damage, or injury caused by the vehicle notwithstanding an exemption provision in the financial lease contract.

RULING: BPI LEASING, being the registered owner, is liable under the law on compulsory vehicle registration and jurisprudence. The policy behind the rule is to enable the victim to find redress by the expedient recourse of identifying the registered vehicle owner in the records of the land transportation office. In accordance with the law on compulsory motor vehicle registration, this Court has consistently ruled that, with respect to the public and third persons, the registered owner of a motor vehicle is directly and primarily responsible for the consequences of its operation regardless of who the actual vehicle owner might be. Well-settled is the rule that the registered owner of the vehicle is liable for quasi-delicts resulting from its use. Thus, even if the vehicle has already been sold, leased, or transferred to another person at the time the vehicle figured in an accident, the registered vehicle owner would still be liable for damages caused by the accident. The sale, transfer or lease of the vehicle, which is not registered with the Land Transportation Office, will not bind third persons aggrieved in an accident involving the vehicle. The compulsory motor vehicle registration underscores the importance of registering the vehicle in the name of the actual owner. The policy behind the rule is to enable the victim to find redress by the expedient recourse of identifying the registered vehicle owner in the records of the Land Transportation Office. The registered owner can be reimbursed by the actual owner, lessee or transferee who is

known to him. Unlike the registered owner, the innocent victim is not privy to the lease, sale, transfer or encumbrance of the vehicle. Hence, the victim should not be prejudiced by the failure to register such transaction or encumbrance. CA was correct in deleting attorneys fees for being speculative. Attorneys fees must be proven. The rule is not to grant attorneys fees for the reason that no premium should be placed on the right to litigate.